Jan Vishwas Act 2026 Amends RERA: Jail Term Removed for Homebuyer Non-Compliance

The Jan Vishwas (Amendment of Provisions) Act, 2026, which came into force on May 15, 2026, has amended Section 68 of the Real Estate (Regulation and Development) Act, 2016 (RERA), removing the imprisonment provision for homebuyers who fail to comply with orders of the Real Estate Appellate Tribunal. The amendment replaces what was previously a criminal penalty, comprising imprisonment of up to one year along with a fine of up to ten per cent of the property cost, with a purely monetary penalty capped at ten per cent of the property cost. This change is part of a broader legislative effort under the Jan Vishwas framework to decriminalise minor, technical, and procedural defaults across 80 central Acts.

What Section 68 of RERA Previously Required

Under the original text of RERA, Section 68 dealt with the consequences of an allottee (homebuyer) failing to comply with, or contravening, any order or direction of the Real Estate Appellate Tribunal. The penalty was imprisonment for a term which could extend to one year, or a fine for every day during which the default continued, subject to a maximum of ten per cent of the cost of the apartment, plot, or building. This was a criminal provision, meaning that non-compliance could lead to prosecution, a criminal record, and even imprisonment. In practice, this provision was rarely invoked against homebuyers, as most RERA disputes involve builders failing to deliver projects on time rather than homebuyers defying tribunal orders. However, the existence of a criminal penalty for what is essentially a civil non-compliance was seen as disproportionate and inconsistent with the broader goal of making regulatory compliance less punitive for individuals.

What the Jan Vishwas Act 2026 Changes

The Jan Vishwas (Amendment of Provisions) Act, 2026 replaces the criminal penalty under Section 68 with a civil penalty. An allottee who defies an order of the Real Estate Appellate Tribunal is now liable only to a monetary penalty of up to ten per cent of the cost of the apartment, plot, or building. The imprisonment provision has been entirely removed. This means that non-compliance by a homebuyer is no longer a criminal offence but a civil matter attracting a financial penalty. The amendment does not change the penalties applicable to builders and promoters under Sections 59 to 67 of RERA, which remain intact and continue to carry both monetary and imprisonment penalties for serious violations such as failure to register a project, misleading advertisements, and failure to comply with the orders of the Real Estate Regulatory Authority. The change is specifically targeted at Section 68, which applies to allottees.

The Jan Vishwas Framework: Decriminalising 80 Central Acts

The RERA amendment is part of a much larger legislative initiative. The Jan Vishwas (Amendment of Provisions) Bill, 2026 amends 80 central Acts to decriminalise or rationalise offences and penalties. The Bill was introduced in Parliament by the Minister of State for Commerce and Industry and envisages a shift from criminal penalties for minor, technical, or procedural defaults to civil and administrative enforcement mechanisms. The philosophy behind the Jan Vishwas framework is that criminal law should be reserved for serious offences, while regulatory non-compliance that does not involve fraud, moral turpitude, or public harm should be addressed through monetary penalties, adjudication, and administrative remedies. This approach is designed to reduce the burden on criminal courts, encourage voluntary compliance by reducing the stigma attached to regulatory defaults, and align India's regulatory framework with international best practices. The 2026 Bill follows the first Jan Vishwas Act of 2023, which decriminalised over 180 offences across 42 Acts.

Criticism and Concerns About the RERA Amendment

While the removal of imprisonment for homebuyer non-compliance has been welcomed by many as a proportionate reform, some legal commentators and homebuyer advocacy groups have raised concerns. The primary criticism is that the amendment may weaken the deterrent effect of RERA orders. If a homebuyer knows that the maximum consequence of defying a tribunal order is a financial penalty, they may be less inclined to comply promptly, particularly in cases involving large property values where the penalty amount is manageable. Others have pointed out that the amendment does not address the more pressing enforcement challenges in RERA, such as the chronic understaffing of Real Estate Regulatory Authorities, delays in adjudication, and the difficulty homebuyers face in enforcing orders against builders who ignore tribunal directions. The focus of the Jan Vishwas amendment on Section 68 (allottee non-compliance) rather than on strengthening enforcement against builders has been criticised as addressing the wrong end of RERA's enforcement problem.

Key Takeaways for Homebuyers and Developers

The Jan Vishwas Act 2026 RERA amendment has several practical implications. Homebuyers who receive adverse orders from the Real Estate Appellate Tribunal no longer face the risk of imprisonment for non-compliance. The maximum penalty is now a monetary fine of up to ten per cent of the property cost. Builder and promoter penalties under RERA remain unchanged, and continue to include both imprisonment and monetary penalties for serious violations. The amendment took effect on May 15, 2026, meaning it applies to all non-compliance occurring after that date. For ongoing disputes, homebuyers should note that the removal of criminal penalties does not affect the validity or enforceability of tribunal orders, as these remain binding and can be enforced through execution proceedings. The broader Jan Vishwas framework signals the government's continuing intent to replace criminal penalties with civil penalties across a range of regulatory statutes, which businesses and individuals should factor into their compliance strategies.